Question 5

1. Dividends are paid pre-tax to shareholders

True

False

Question 6

1. Pre-emptive right allows existing stockholders to purchase additional shares before a firm offers new shares to the public

True

False

Question 7

1. Beta measures stock volatility - which is how the stock moves in value compared to the rest of the market.

True

False

Question 8

1. A Income Stock is

A stock in a company that pays a cash dividend higher than that which is offered by most companies.

A stock in a company that offers the promise of much higher profits tomorrow and has a consistent record of growth in earnings in all economic conditions

A stock in a company that trades at a low price relative to its company fundamentals

Does not exist because on bonds provide income

Question 9

1. A Growth Stock is

A stock in a company that pays a cash dividend higher than that which is offered by most companies.

A stock in a company that offers the promise of much higher profits tomorrow and has a consistent record of growth in earnings in all economic conditions

A stock in a company that trades at a low price relative to its company fundamentals

Does not exist because on bonds provide income

Question 10

1. A Value Stock is

a.A stock in a company that pays a cash dividend higher than that which is offered by most companies.

b.A stock in a company that trades at a low price relative to its company fundamentals

c.A stock in a company that trades at a high price relative to its company fundamentals

d.Does not exist because on bonds provide income

Question 11

1. All common stock pay dividends

True

False

Question 12

1. Inverting a P/E ratio of a stock, give you the expected earnings yield of the stock

True

False

Question 13

1. Book value per share is the true value of each share of a company

True

False

Question 14

1. ESO plan is a gift from the employer to the employee. It allows the employee to exercise stock options. It is not the same as a

a.Discount stock purchase plan

b.A 401k plan

c.A pension plan

d.It is not the same as all of the above

Question 15

1. Question every investor shouel ask themselves prior to investing include all EXCEPT

a.My investment goals

b.My investment experience

c.My age and family responsibility

d.My preference of stocks vs bonds

Question 16

1. 10Q lists the company's

a.Yearly report

b.Prospectus

c.Quarterly report

d.Analyst ratings

Question 17

1. Which is not a stock market index

a.S&P 500

b.Dow Jones Industrial Average

c.Dow Jones Wilshire 5000

d.Indianapolis 500

Question 18

1. In order to trade stocks, you need to open a brokerage account. Which of the following is not a place to open a brokerage account

a.eTrade

b.Fidelity

c.ShareBuilder

d.Morningstar

Question 19

1. Some costs involved in buying and selling a stock or bond and having an account at a brokerage are

a.Commission

b.Per share fees

c.Annual account maintenance fee

d.All are possible costs involved in having a brokerage account

Question 20

1. The margin rate set by the Federal Reserveis now

a.50% of the value or equity in an investment that is not borrowed

b.25% of the value or equity in an investment that is not borrowed

c.75% of the value or equity in an investment that is not borrowed

d.100% of the value or equity in an investment that is not borrowed